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By rdnewsNOW staff

driver seeing bills spike

Alberta strikes panel to review auto insurance, won’t bring back rate cap

Dec 18, 2019 | 3:29 PM

EDMONTON – Alberta has launched a review of auto insurance in the province to ensure that the industry can remain viable and drivers can get affordable coverage.

Finance Minister Travis Toews says Albertans are paying some of the highest rates in Canada but are having trouble getting critical protections, such as comprehensive and collision coverage.

“We know the automobile insurance industry in our province is no longer meeting Albertans’ needs. We pay some of the highest automobile insurance rates in the country,” said Toews. “I look forward to the committee’s report and findings.”

Auto insurance rates had been capped at five per cent for the last couple of years, but the UCP government did not renew that cap in August and some drivers have since reported getting notices of steep rate hikes in the new year.

Insurers have said that under the cap they were losing money in Alberta, given a rise in payouts due to issues including car theft, injury claims, and high repair costs tied to more expensive technology in vehicles.

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Toews says a three-member committee has been asked to find solutions that work for all parties within the existing privately delivered system.

“It’s laughable to claim that this million-dollar committee is the solution. This is simply the government kicking the can down the road and leaving Albertans to deal with the extra costs,” said Jon Carson, NDP Official Opposition Critic for Service Alberta.

“Our caucus warned this Government that lifting the cap would cause Albertans to face large rate hikes. The UCP dismissed these concerns and now we’re hearing from hundreds of Albertans whose bills are going up.”

The Insurance Bureau of Canada, meantime, is applauding the review.

“IBC and the insurance industry have heard loud and clear from consumers that Alberta’s auto insurance system isn’t working,” said Celyeste Power, Vice-President, Western, IBC. “Alberta’s 3 million drivers have said they want more affordable premiums, more choice and care they can count on when they need it. We encourage all stakeholders that participate in the government’s review to focus on what consumers want and, frankly, deserve.”

The committee is to report back in the spring, and Toews says the government will take action as soon as possible after that.

(With file from The Canadian Press, media releases)